A simple explanation of the Internet of Things

The Internet of Things is a technological model based on two main assumptions: each physical object (the Things) can be implemented with some kind of technology and thus turned into a smart object connected to the internet, often with a wireless connection.

These smart connected objects make up a widespread network and the information and data that they provide are available thanks to and through this network. The IoT makes these data available to third parties which can handle, manipulate, process, enrich and

use them in order to create new value. IoT sensors and connectivity allow the interconnection and integration of physical objects: real economy items create valuable data and information thanks to the technology they are provided with. By adopting this new model, it is possible to create new services and new business models. The IoT is, ultimately, an ecosystem of hardware and software technologies (and of the related services) the integration of which modifies and/or increases the functions of the physical object: the IoT is a technological model and the IoT market is a technological market, gathering under one all-encompassing label, several different technologies. Ericsson, one of the worldwide leading companies providing telecommunications equipment and services, forecast there will be around 29 billion connected devices by 2022.

What is the Industrial Internet of Things, as known as Industry 4.0?

It is the same technological model we referred to above, but with a focus on factories, production plants, sensors networks and everything related to the industrial world. Both a single smart machine and the entire enterprise equipment are able to gather, register and share information thanks to machine to machine and machine to human communication processes.
This information can be securely stored in the cloud where it can be monitored, analysed and processed.

The smart machines network together with a data management system optimize the operational effectiveness and the industrial production process, actively contributing to the growth of the enterprise.

Advantages for enterprises

Below is an extract of an interview with the CEO of Roland Berger Italia: “The benefits for the entrepreneur and the shareholders that derive from investments in Industry 4.0 are estimated in the measure of 30%-40%. Such is the impact on the return on capital (Roce) resulting from the adoption of Industry 4.0 to an average level of intensity over a period of about three years.

A practical example: by applying a predictive maintenance service to healthcare industry medical equipment, it is possible to achieve a 25% reduction in the annual maintenance intervention costs.
The cost of a single technical intervention is around 100€ per hour and lasts between 8 and 16 hours.
A medical machine maintenance intervention, extra costs included, could be up to 2000euro per year.
Assuming sales of 5000 units, with 50% requiring maintenance four times a year, predictive maintenance eliminates one intervention a year with a saving of €5 million.

How does an IoT system work?
IoT system infographic

Do you need more info?